Nanjing Medical Loses 10 Million Yuan In Medical Trust
This article was originally published in PharmAsia News
Executive Summary
Nanjing city government started reforming nine municipal third-tier hospitals at the end of May but without the medical trust model it has been advocating. An informed source discloses that participating company Nanjing Medical lost over 10 million yuan in 2007 due to the medical trust although it has enlisted more than 100 first- and second-tier hospitals. Pharmaceutical distributors have to transfer 35 percent of their sales revenue as trust expenses to the hospitals, but with more distributors entering the business, the revenue allocation rate has gone up to 53 percent. This could sound the death knell for the medical trust scheme. Meanwhile, Nanjing Medical has denied its losses; research by Shenyin & Wanguo shows the firm's annual medical trust earned a profit of 2-3 percent. (Click here for more - Chinese Language)